The two Americans behind the Dropil project pleaded guilty to defrauding thousands of investors forown enrichment.
Jeremy David McAlpin, 25, and Zachary Michael Matar, 28, are charged with securities fraud.
According to court documents, in 2017McAlpin and Matar founded Dropil Inc. The company was primarily raising funds to develop the digital asset DROP, as well as its own automated trading bot called Dex.
On the Dropil website, they posted a series of falseadvertising statements to attract investors. In early 2018, they launched an Initial Coin Offering (ICO) for the DROP sale. However, prior to the ICO, Dropil Inc did not register with the Securities and Exchange Commission (SEC) as a broker or dealer.
In total, defendants received approximately $1,896,657 from 2,472 investors through the sale of 629 million DROPs, which they transferred into their own and affiliates' accounts.
Subscribe to ForkNews on Telegram to stay up to date with news from the world of cryptocurrencies
Read this:
SEC accused Dropil startup of fraudulent ICO
Africrypt Founders Denied Fraud Allegations
Bitfinex exchange calls itself a victim of fraud
SEC suspends fraud suspected cryptocurrency fund
YouTube admitted deleting cryptocurrency video content as a mistake
Bush administration lobbyist accused of $ 5.6 million cryptocurrency fraud